Sub-prime Meltdown Hits Thailand With Force

[Cyberstar]

Some positive news for a change:

...

Shares of energy companies such as Exxon Mobil XOM.N soared as oil prices rocketed to $73.53 a barrel after a sharp drop in U.S. crude and gasoline stockpiles revived supply concerns.

...

To me that sounds more like extremely bad news that can't but speed up the economical downturn process.... Oh, I see - the positive thing is that we get quicker to the point where it can only go upwards.

[LaoPo]

Thursday August 30, 2007:

Reuters Before the Bell news mail.

Hope may spring eternal, but The Wall Street Journal is warning that it could be ill-founded when pinned on an interest-rate cut. Stock futures are pointing down.

The market had rallied yesterday when Fed chief Ben Bernanke indicated the central bank was "prepared to act as needed" to make sure credit market woes don't hurt the economy.

But Journal writer Greg Ip wrote in today's paper that the Fed is not rushing to cut benchmark rates because Bernanke wants investors to stop counting on such moves to rescue them from market convulsions.

The man himself is speaking tomorrow on housing and monetary policy. For today, though, there's a batch of data, including gross domestic product numbers and the Kansas City Fed manufacturing survey.

U.S. Treasuries are higher, and the dollar is down against the yen and up against the euro.

Oil prices are steady after yesterday's rally sparked by data showing a surprisingly large drop in U.S. crude and gasoline supplies.

H&R Block's sale of its money-losing Option One subprime mortgage unit may be ... er, blocked. The tax preparer, which also reported a much bigger quarterly loss, says it's renegotiating the deal with private equity buyer Cerberus.

Sears Holdings reported a disappointing drop in quarterly earnings and revenue.

There's going to be a touch of Wal-Mart at the Hyatt hotels. An investment firm affiliated with the discounter's founding family has teamed up with Goldman Sachs to invest $1 billion in the privately held Global Hyatt Corp.

LaoPo

[LaoPo]

I posted similiar thoughts on another thread last week, basically most of these loans going bad are falling into two catagories.

1. The first catagory is the largest one and that is the non home owners (renters) prior to 2004.......

2. The second group is the flippers(many of whom are from overseas) who got caught late in the cycle, and all I can say here is that these folks...... will be getting exactly what they deserve

I have difficulties with your sentence in #2.....

Can you explain please what you mean by "many of whom are from overseas........getting exactly what they deserve" ?

Are you referring to Latino's, Thai, Eastern Europeans or from other 'overseas' destinations and also: why do they 'deserve' problems only because they are from 'overseas' ?

Are you, in general, referring to immigrants into the US ?

IMHO it is walking on the edge of discrimination but for the time being I'm awaiting your explanation about your remarks.

LaoPo

[LaoPo]

"Subprime hits the Rich": headline from a US investment letter I received today...

Subprime Mortgage Woes Spreading

Subprime Mortgage Crisis Spreading to High-End Housing Market

NEW YORK (AP) -- The subprime mortgage crisis is spreading to a somewhat unexpected place: homes costing more than $500,000.

As lending has rapidly gotten more restrictive for borrowers taking out large loans, sales of expensive homes have fallen sharply around the country during what should be one of the busiest seasons for buyers and sellers, mortgage bankers and real estate agents say.

To some degree the change is due to difficulty getting financing, as borrowers are finding fewer lenders willing or able to fund "jumbo" mortgages, loans for amounts greater than $417,000. Such loans are too big to be guaranteed by government-sponsored housing finance agencies Fannie Mae, Freddie Mac or Ginnie Mae.

Given the troubles in the subprime sector, investor appetite for all types of mortgage loans not guaranteed by housing finance agencies has nose-dived.

Banks until recently were able to offload the risk of many jumbo mortgages by selling the loans to investors. But now, as investors burned by the subprime debacle have become extremely picky about what they will buy, banks are having to keep more of these loans on their own books and as a result are charging higher rates.

Some lenders -- such as Countrywide Financial Corp. -- have made a point of saying they're now most focused on making loans that can be guaranteed by Fannie and Freddie.

Other lenders have simply tightened up their lending standards, for example by no longer making jumbo loans to lenders who can't fully document their income, even if they make large down payments and have stellar credit histories.

The banks that are still making jumbo loans are charging substantially higher rates to compensate for the lack of investor demand. Borrowers who could have gotten rates as low as 6.5 percent in June are now having to pay as much as 9 percent.

But aside from the financial impact of higher rates, in certain high-priced real estate markets, the effect of the suddenly tighter lending environment is more psychological, mortgage bankers and real estate agents say, as buyers and sellers alike don't want to plunge into an uncertain future.

"Showings are down, contracts written are down, and sellers are just as backed away as buyers are," said Lou Barnes, a partner in mortgage bank and brokerage Boulder West Financial Services in Boulder, Colo. The company arranges for financing on many higher-priced condominiums and houses in the state.

"I think the psychological damage is worse than the financial damage" which is already bad enough, he said. Even for buyers who have plenty of cash or can easily afford higher mortgage rates, the sudden change in the financing environment reduces "the ardor to buy a house unless you have to," he adds.

With numerous buyers and sellers sidelined, the higher cost of big mortgages is bound to put downward pressure on home prices should the lending environment stay tight for a long period of time, said Ellen Bitton, president of Park Avenue Mortgage, a mortgage bank and brokerage that does business in several states, including New York, Florida and Utah.

In New York, the most pronounced effect so far has been at the very top end of the market, for properties priced $25 million and above, said Dolly Lenz, vice chairman with Prudential Douglas Elliman.

"Every single person I have at the highest end is on hold. They're going to wait and see what happens," she said. "It has nothing to do with them being able to afford" properties or not, Lenz added. "It's a confidence thing. They somehow feel poorer, whether they are or not."

In California, where the median home price is well above $500,000, jumbo mortgages are as much as 44 percent of all mortgages issued in certain metro areas, according to data from First American LoanPerformance.

In and around San Francisco, where the median home price is about $1.1 million, the tougher financing environment has created a "hesitancy" and has led to some canceled escrows for buyers around the $1 million range, said Rick Turley, president of the San Francisco and Peninsula Region for Coldwell Banker Residential Brokerage.

From: http://biz.yahoo.com/ap/070829/expensive_homes.html?.v=2

LaoPo

[AlexLah]

Can someone please explain in simple terms how it works with the stock market and lending out.

Do I understand it well.

OK I like to buy a house but do not have the money to pay in full.

I go to a bank and they check my salary and cost of living and in the end they can calculate how much I can pay back per month.

OK, we agree on a period of 10 years with an interest rate of 6%.

The bank does not have this money so they ask (sell) a third party for money and they tell there is a 10% return on it.

I am very confused about all of this, please explain to me how this all works in simple language.

Alex

[Carmine6]

Can someone please explain in simple terms how it works with the stock market and lending out.

Do I understand it well.

OK I like to buy a house but do not have the money to pay in full.

I go to a bank and they check my salary and cost of living and in the end they can calculate how much I can pay back per month.

OK, we agree on a period of 10 years with an interest rate of 6%.

The bank does not have this money so they ask (sell) a third party for money and they tell there is a 10% return on it.

I am very confused about all of this, please explain to me how this all works in simple language.

Alex

You've got it basically right except that the lender does have the money available to begin with. They sell pools of loans off to get more money to fund more loans.

From the lenders side:

1. Start with money to lend
   
2. Lend money to borrowers
   
3. Instead of holding onto the loan, pool them together with thousands of other loans and sell bonds based on those loans
   
4. Take the money you get from selling the bonds and make more loans
   

The lenders usually keep the servicing rights, which means that even though the loan was sold off, they service the loan as if they still owned it. The borrower keeps making payments to the original lender. The lender gets a servicing fee and then the other money goes toward paying back the bonds. Right now, it is hard to sell those bonds, leaving lenders without a way to get more money to lend.

One distinction to make is between banks and non-bank lenders. Banks can borrow money at good rates so can keep making loans. Many non-bank lenders have little money to keep making loans. They can loan money until they run out, but unless they can start selling bonds again, they'll have a hard time making a lot of new loans.

The stock market doesn't have anything to do with the loans directly. The reason stocks are moving is that the funds and companies that bought the bonds are going to take a lot of losses. Defaults on those loans are likely to be much higher than people expected which means the bondholders will not get back close to what they were supposed to. Since a lot of jobs in the US are dependent on the real estate market, it affects the economy as well.

[Carmine6]

CNBC World is announcing that President Bush will announce a plan tomorrow to assist subprime borrowers who can't make payments. Look for Congress now try to come up with their own plan.

http://www.cnbc.com/id/20521776

Bush to Outline Subprime Mortgage Initiative

President George W. Bush will outline reforms on Friday intended to help homeowners with subprime mortgages avoid default, a senior U.S. administration official said on Thursday.

"He will also discuss reform efforts to prevent these kinds of problems from arising in the future," the official told Reuters on condition of anonymity...

snip

Bush in a statement scheduled for 11:10 a.m. in the White House Rose Garden will discuss the need for Congress to pass Federal Housing Administration reform legislation aimed at giving the agency the flexibility to help subprime mortgage borrowers, the official said.

The risk of a credit squeeze stemming from rising defaults on subprime mortgages has fueled worry that consumers will trim spending at a rate that could tip the economy into recession.

An administration official told Reuters that Bush "will discuss his willingness to work with Congress in a bipartisan way to reform the tax code to help troubled borrowers rework their loans."

[Jai Dee]

Foreign investors to return in post-election period, says economist

Foreign investors have slowed investment in the Stock Exchange of Thailand upon concerns over the sub-prime mortgage woes in the United States, but are likely to return to invest when the new government is formed, according to a leading economist.

Supavut Saicheu, president of Phatra Securities Research Group, said the sub-prime debacle seemed difficult to ease or end this year since the exact damages caused by the problems had not yet been clearly estimated.

It worried investors around the world and made them reluctant to invest in high-risk assets, particularly stocks, for a while.

However, he forecast foreign capital would flow back into the Thai stock market again when the post-election government began to administer the country.

What the government should do urgently is to push for the sound economic policy and strengthen the economic fundamental to attract foreign investment into the country.

He said the exact damages incurred by the sub-prime lending woes are likely to be clearly estimated in the third quarter of this year.

Listed companies and mutual funds would show in their financial statements how much they had invested in instruments linked with the sub-prime mortgage in that quarter.

After that, Mr. Supavut said he believed foreign investors, who had slowed their investment in stock markets, would return to invest, particularly in stock markets in Asian countries including China and India where economic growth remains sound as well as Thailand where the price/earning ratio of the market is low.

The economist also said the baht is expected to continue strengthening until year-end unless the state is able to address the significant current account surplus problem.

Source: TNA - 31 August 2007

[LaoPo]

CNBC World is announcing that President Bush will announce a plan tomorrow to assist subprime borrowers who can't make payments. Look for Congress now try to come up with their own plan.

http://www.cnbc.com/id/20521776

Bush to Outline Subprime Mortgage Initiative

President George W. Bush will outline reforms on Friday intended to help homeowners with subprime mortgages avoid default, a senior U.S. administration official said on Thursday.

"He will also discuss reform efforts to prevent these kinds of problems from arising in the future," the official told Reuters on condition of anonymity...

snip

Bush in a statement scheduled for 11:10 a.m. in the White House Rose Garden will discuss the need for Congress to pass Federal Housing Administration reform legislation aimed at giving the agency the flexibility to help subprime mortgage borrowers, the official said.

The risk of a credit squeeze stemming from rising defaults on subprime mortgages has fueled worry that consumers will trim spending at a rate that could tip the economy into recession.

An administration official told Reuters that Bush "will discuss his willingness to work with Congress in a bipartisan way to reform the tax code to help troubled borrowers rework their loans."

It will be interesting to hear what George W. has to say in his plans. In the meantime, ahead of the same:

Countrywide and Goldman shares rise

Fri Aug 31, 2007 12:52 PM BST163

NEW YORK (Reuters) - Shares of No. 1 U.S. mortgage lender Countrywide Financial Corp (CFC.N: Quote, Profile , Research) rose before the opening bell on Friday as investors bet President Bush would present a plan to help subprime mortgage borrowers who can't make their loan payments.

Countrywide shares climbed 9 percent to $21.40 in before-hours trading.

Other financial sector shares were higher ahead of Bush's 11:10 a.m. EDT speech, including investment bank Goldman Sachs Group (GS.N: Quote, Profile , Research), up 2.1 percent to $175.

Reuters.

Note: if he's going to say what I think the Administration is going to use tax-money to help the 'poor' loaners and even poorer borrowers; if the rich(er) are happy with that remains to be seen, although the rich(er) themselves suffer also due to the stricter rules from mortgage banks as it is hard to get a loan/mortgage right now.

More important IMHO is hat the mortgage/subprime system itself has to be changed.

LaoPo

[LaoPo]

Reuters Before the Bell news mail.

"Rescue me," Wall Street is begging the government, and it's likely to get some sort of response today from President Bush and Fed chief Ben Bernanke. Both officials are addressing housing and the subprime mess on this last business day of summer, and stock futures are pointing up.

Bernanke is speaking soon after the market opens. Investors are hoping to get some idea of whether the central bank plans to cut interest rates. But the speech is coming after a flood of economic data, including the core personal consumption expenditures index, one of the Fed's favorite inflation gauges.

Also on tap are reports on Midwest business activity, U.S. factory orders and consumer sentiment.

This afternoon, Bush will propose legislation aimed at giving the Federal Housing Administration the flexibility to help subprime mortgage borrowers.

Reuters.

LaoPo

[lannarebirth]

Reuters Before the Bell news mail.

"Rescue me," Wall Street is begging the government, and it's likely to get some sort of response today from President Bush and Fed chief Ben Bernanke. Both officials are addressing housing and the subprime mess on this last business day of summer, and stock futures are pointing up.

Bernanke is speaking soon after the market opens. Investors are hoping to get some idea of whether the central bank plans to cut interest rates. But the speech is coming after a flood of economic data, including the core personal consumption expenditures index, one of the Fed's favorite inflation gauges.

Also on tap are reports on Midwest business activity, U.S. factory orders and consumer sentiment.

This afternoon, Bush will propose legislation aimed at giving the Federal Housing Administration the flexibility to help subprime mortgage borrowers.

Reuters.

LaoPo

Aren't the major markets on Wall Street currently trading about 5% off the all time highs? Rescued from what exactly? It's extortion. They're saying we'll take this market down if you don't give us what we want. Public buys into thos nonsense because they're all in up to their eyeballs. That's how wars start.

[Carmine6]

Reuters Before the Bell news mail.

"Rescue me," Wall Street is begging the government, and it's likely to get some sort of response today from President Bush and Fed chief Ben Bernanke. Both officials are addressing housing and the subprime mess on this last business day of summer, and stock futures are pointing up.

Bernanke is speaking soon after the market opens. Investors are hoping to get some idea of whether the central bank plans to cut interest rates. But the speech is coming after a flood of economic data, including the core personal consumption expenditures index, one of the Fed's favorite inflation gauges.

Also on tap are reports on Midwest business activity, U.S. factory orders and consumer sentiment.

This afternoon, Bush will propose legislation aimed at giving the Federal Housing Administration the flexibility to help subprime mortgage borrowers.

Reuters.

LaoPo

Aren't the major markets on Wall Street currently trading about 5% off the all time highs? Rescued from what exactly? It's extortion. They're saying we'll take this market down if you don't give us what we want. Public buys into thos nonsense because they're all in up to their eyeballs. That's how wars start.

The claims some of these guys are making is nuts - great depression coming, stock market is going to crash, worst mortgage market since the Great Depression, etc. There was no mortgage market at the time of the great depression. I doubt there was that big a market in the 1980's.

But they really do mean rescue them because while the indices are fine, major investment bank stocks are down a lot from their highs this year. Lehman Brothers was $85, now $55, Goldman was $229, now $177, Bear Stearns was $170, now $109. Hedge funds have gone under, mortgage lenders have gone under. IPOs that were in the works are on hold, as are some mergers. The commercial paper market is barely moving. That all spells much lower revenue for Wall Street firms which is quite a contrast when this year was set to break records.

Wall Street bonuses come out by December so the I banking revenues and profits have to make a big comeback by then or the bonuses are going to get hacked. That's if they get to keep their jobs in the first place. Heads have already started to roll. Doesn't matter to them if the rates cuts happen in November or December, the bonuses are already gone by then. Goldman Saks bonuses worked out to an average $622,000 per person last year. Lehman's average was in the $300,000 range per person.

A lot of these guys also have a lot of money at risk in hedge funds.

Extortion is right.

Edited August 31, 2007 by Carmine6

[VegasVic]

I posted similiar thoughts on another thread last week, basically most of these loans going bad are falling into two catagories.

1. The first catagory is the largest one and that is the non home owners (renters) prior to 2004.......

2. The second group is the flippers(many of whom are from overseas) who got caught late in the cycle, and all I can say here is that these folks...... will be getting exactly what they deserve

I have difficulties with your sentence in #2.....

Can you explain please what you mean by "many of whom are from overseas........getting exactly what they deserve" ?

Are you referring to Latino's, Thai, Eastern Europeans or from other 'overseas' destinations and also: why do they 'deserve' problems only because they are from 'overseas' ?

Are you, in general, referring to immigrants into the US ?

IMHO it is walking on the edge of discrimination but for the time being I'm awaiting your explanation about your remarks.

LaoPo

WOW, I go on a 4 day golfing road trip and come back to find this sort of garbage! Lao this is really beneath you (at least I hope it is), this is the type of crap that I would expect from Palm or perhaps highdiver. Lets see now, you repost just a segment of one of my sentences and then to add insult to injury you highlight the part of the sentence that the emphasis was clearly not even on, kind of shows everyone where your head is at Lets take a look at the complete sentence and perhaps I can give you a bit of an english lesson in the process. The sentence in question was "The second group is the flippers(many of whom were from overseas) who got caught late in the cycle, and all I can say here is that these folks along with some of the hedge funds will be getting exactly what they deserve". Now when one looks at the entire sentence in its original context it is easy to see that I was glad to see the "flippers" and "hedge funds" taking it on the chin, I should have added in the greedy predatory lenders(Countrywide being a prime example) to that list. Late in the boom cycle, (especially in Florida and California) the flipping mania in U.S. real estate brought in a large group of foriegners from Europe, Latin America and Asia and these folks along with the greedy Americans that entered late in the cycle were looked upon as suckers who bought in at the top of an unsustainable boom (kind of like the folks currently buying stocks in Shanghai today). These investors (I am using that term loosely) were buying mutltiple homes in S. California and multiple condos in Florida for $425,000-$450,000, that just 3 years earlier were selling for $210,000-$225,000, this is a prime example of what we in the states call the greater fool theory. To a degree I actually feel sorry for the foriegners that got caught holding overvalued properties in the U.S. as they clearly did not realize what was going on, but on the other hand they were motivated by greed and did not do their due dilligence so perhaps they got what they deserved. Homes are to be bought to live in or with the investment intent to rent out for many years, this hedge fund (make a quick dollar) leveraged mentality of buying multiple homes with the intent of flipping them sometimes before they are even out of escrow, smacks more of the great tulip boom in Europe many years ago. By the way, despite your taking the mantle away from bingoboingo of making multiple negative information posts on a daily basis, I do see that I was correct in my prediction that the U.S. stock markets would be up this week try and have a nice day Lao!

[VegasVic]

Reuters Before the Bell news mail.

"Rescue me," Wall Street is begging the government, and it's likely to get some sort of response today from President Bush and Fed chief Ben Bernanke. Both officials are addressing housing and the subprime mess on this last business day of summer, and stock futures are pointing up.

Bernanke is speaking soon after the market opens. Investors are hoping to get some idea of whether the central bank plans to cut interest rates. But the speech is coming after a flood of economic data, including the core personal consumption expenditures index, one of the Fed's favorite inflation gauges.

Also on tap are reports on Midwest business activity, U.S. factory orders and consumer sentiment.

This afternoon, Bush will propose legislation aimed at giving the Federal Housing Administration the flexibility to help subprime mortgage borrowers.

Reuters.

LaoPo

Aren't the major markets on Wall Street currently trading about 5% off the all time highs? Rescued from what exactly? It's extortion. They're saying we'll take this market down if you don't give us what we want. Public buys into thos nonsense because they're all in up to their eyeballs. That's how wars start.

The claims some of these guys are making is nuts - great depression coming, stock market is going to crash, worst mortgage market since the Great Depression, etc. There was no mortgage market at the time of the great depression. I doubt there was that big a market in the 1980's.

But they really do mean rescue them because while the indices are fine, major investment bank stocks are down a lot from their highs this year. Lehman Brothers was $85, now $55, Goldman was $229, now $177, Bear Stearns was $170, now $109. Hedge funds have gone under, mortgage lenders have gone under. IPOs that were in the works are on hold, as are some mergers. The commercial paper market is barely moving. That all spells much lower revenue for Wall Street firms which is quite a contrast when this year was set to break records.

Wall Street bonuses come out by December so the I banking revenues and profits have to make a big comeback by then or the bonuses are going to get hacked. That's if they get to keep their jobs in the first place. Heads have already started to roll. Doesn't matter to them if the rates cuts happen in November or December, the bonuses are already gone by then. Goldman Saks bonuses worked out to an average $622,000 per person last year. Lehman's average was in the $300,000 range per person.

A lot of these guys also have a lot of money at risk in hedge funds.

Extortion is right.

I am happy to see that Mr. Bernanke and Mr. Bush have not given in to this "extortion" as you put it. It appears that while the FED chairman and the President are willing to act on a moments notice should the economy be in danger, they are most certainly not giving any indication that they will be bailing out the hedge funds, investment banks or predatory lenders. In fact Mr. Bernanke has remained consistent and very conservative not giving any indication that he intends on lowering the FED funds rate in September. While it certainly brings a tear to my eye to see some of the hedge funds in this sector go belly up and to see that Wall street bonuses cut in half this year (only $300,000 what a shame ), and the fact that this will certainly have a negative impact on the holiday sales season for those overpriced shops in Manhattan, Larchmont and Darien , at least we may finally see some regulation in the hedge fund industry just like we already have in place with mutual funds. As has been pointed out earlier on in this forum the Dow Jones Industrials is less than 5% off its all time high and while some of those areas (primarily California and Florida) that saw a doubling of real estate prices 3 years ago are indeed seeing a 30%+ retracement now, the median price of a home in the U.S. is only down .6% (yes thats right, about 1/2 of 1%) over this time last year, and there are many areas in the N.E., N.W. and western U.S. where home prices are actually rising. I have a funny feeling that when we look back at this current situation years from now we will call this the mini crisis of 2007!

[Carmine6]

snip

I am happy to see that Mr. Bernanke and Mr. Bush have not given in to this "extortion" as you put it. It appears that while the FED chairman and the President are willing to act on a moments notice should the economy be in danger, they are most certainly not giving any indication that they will be bailing out the hedge funds, investment banks or predatory lenders. In fact Mr. Bernanke has remained consistent and very conservative not giving any indication that he intends on lowering the FED funds rate in September. While it certainly brings a tear to my eye to see some of the hedge funds in this sector go belly up and to see that Wall street bonuses cut in half this year (only $300,000 what a shame ), and the fact that this will certainly have a negative impact on the holiday sales season for those overpriced shops in Manhattan, Larchmont and Darien , at least we may finally see some regulation in the hedge fund industry just like we already have in place with mutual funds. As has been pointed out earlier on in this forum the Dow Jones Industrials is less than 5% off its all time high and while some of those areas (primarily California and Florida) that saw a doubling of real estate prices 3 years ago are indeed seeing a 30%+ retracement now, the median price of a home in the U.S. is only down .6% (yes thats right, about 1/2 of 1%) over this time last year, and there are many areas in the N.E., N.W. and western U.S. where home prices are actually rising. I have a funny feeling that when we look back at this current situation years from now we will call this the mini crisis of 2007!

Yeah, extremely well played by Ben. He basically said, look it's not my job to save people from their bad decisions, but we will throw life lines to others who are going to be dragged along.

By the way the $300k was the average at Lehman last year, it wasn't the drop from last year to this. Big job cuts are expected in structured finance groups on Wall Street after this weekend. Those who keep their jobs will do ok, but not as good as they were expecting. 3 months from the finish line and someone threw landmines on the track.

[LaoPo]

I posted similiar thoughts on another thread last week, basically most of these loans going bad are falling into two catagories.

1. The first catagory is the largest one and that is the non home owners (renters) prior to 2004.......

2. The second group is the flippers(many of whom are from overseas) who got caught late in the cycle, and all I can say here is that these folks...... will be getting exactly what they deserve

I have difficulties with your sentence in #2.....

Can you explain please what you mean by "many of whom are from overseas........getting exactly what they deserve" ?

Are you referring to Latino's, Thai, Eastern Europeans or from other 'overseas' destinations and also: why do they 'deserve' problems only because they are from 'overseas' ?

Are you, in general, referring to immigrants into the US ?

IMHO it is walking on the edge of discrimination but for the time being I'm awaiting your explanation about your remarks.

LaoPo

WOW, I go on a 4 day golfing road trip and come back to find this sort of garbage! Lao this is really beneath you (at least I hope it is), this is the type of crap that I would expect from Palm or perhaps highdiver. Lets see now, you repost just a segment of one of my sentences and then to add insult to injury you highlight the part of the sentence that the emphasis was clearly not even on, kind of shows everyone where your head is at Lets take a look at the complete sentence and perhaps I can give you a bit of an english lesson in the process. The sentence in question was "The second group is the flippers(many of whom were from overseas) who got caught late in the cycle, and all I can say here is that these folks along with some of the hedge funds will be getting exactly what they deserve". Now when one looks at the entire sentence in its original context it is easy to see that I was glad to see the "flippers" and "hedge funds" taking it on the chin, I should have added in the greedy predatory lenders(Countrywide being a prime example) to that list. Late in the boom cycle, (especially in Florida and California) the flipping mania in U.S. real estate brought in a large group of foriegners from Europe, Latin America and Asia and these folks along with the greedy Americans that entered late in the cycle were looked upon as suckers who bought in at the top of an unsustainable boom (kind of like the folks currently buying stocks in Shanghai today). These investors (I am using that term loosely) were buying mutltiple homes in S. California and multiple condos in Florida for $425,000-$450,000, that just 3 years earlier were selling for $210,000-$225,000, this is a prime example of what we in the states call the greater fool theory. To a degree I actually feel sorry for the foriegners that got caught holding overvalued properties in the U.S. as they clearly did not realize what was going on, but on the other hand they were motivated by greed and did not do their due dilligence so perhaps they got what they deserved. Homes are to be bought to live in or with the investment intent to rent out for many years, this hedge fund (make a quick dollar) leveraged mentality of buying multiple homes with the intent of flipping them sometimes before they are even out of escrow, smacks more of the great tulip boom in Europe many years ago. By the way, despite your taking the mantle away from bingoboingo of making multiple negative information posts on a daily basis, I do see that I was correct in my prediction that the U.S. stock markets would be up this week try and have a nice day Lao!

1。Thank you for trying to teach me your kind of American English. I'm afraid I will never get used to your wording and writing.

But, whatever happens, I will always try to be polite unlike yourself, since there is no need to use and address words to me as "garbage"and "crap". Please just try to behave like a gentleman, will you please?

2. But, I understand your sentence better now, as described in your sentence #2, as you didn't mean what I thought it was meant, by you.

The misunderstanding was created by yourself by using words and descriptions in sentences some of us are not used to. Try to use normal English, instead your local slang.

3. I'm not trying to take a 'mantle' away from anybody. I do not need to do so, and I do not post negative information on a daily basis. I read, amongst many other sources, American financial news day-in-day-out and post articles, whether negative OR positive, I find important for the readers here on TV.

If you don't like that, don't read them. The content of these articles are mostly written by important news channels/agencies from your own country, not by me.

If you have a problem with that, write and complain with them, not me.

4. Apart from the above I find it quite odd, and almost nationalistic, you're always trying (for a major part) to blame ''outside'-US sources/people/institutions/banks/greedy hedge funds etc.

May I remind you that the sub-prime crisis has it's origin in the US and not abroad.

IMHO the financial [mortgage] system in the US is sick, very sick, and it's creators come from 'Wall Street' and the like, and was spread around the world by your fellow US financial geniuses, not by me.

If it was not in jeopardy Mr. George W. and Mr. Bernanke wouldn't have to address the Nation, would they ?

I'm an observer what's happening in the financial world [and why] and post about it, thats all, whether negative or positive, but I'm not trying to be a financial genius, unlike some others...

Have a nice weekend or..what's left of it

LaoPo

[highdiver]

WOW, I go on a 4 day golfing road trip and come back to find this sort of garbage! Lao this is really beneath you (at least I hope it is), this is the type of crap that I would expect from Palm or perhaps highdiver.

no there is no problem in sub prime..or credit...... it must be only those silly foold forigners. that got overpriced houses

.and your predicititions......

I would imagine your advice in getting countrywide stocks have nothing to do with your position??

If ignorance of economy is bliss, you must be orgasmic.

Harvard University economist Martin Feldstein said the U.S. housing-market recession threatens to sink the broader economy, and the Federal Reserve can cut interest rates without abandoning its goal of price stability.

``The economy could suffer a very serious downturn,'' Feldstein, president of the group that dates U.S. recessions, told a Fed conference in Jackson Hole, Wyoming. ``A sharp reduction in the interest rate, in addition to a vigorous lender-of-last-resort policy, would attenuate that very bad outcome.''

Already, some indicators are suggesting a weakening economy. First-time applications for jobless benefits rose to the highest level since April in the week ended Aug. 25. Property values in 20 metropolitan areas fell 3.5 percent in June from a year earlier, according to an Aug. 28 report by S&P/Case-Shiller.

Feldstein outlined a ``triple threat'' from housing: a ``sharp decline'' in home prices and construction; higher borrowing costs and a ``freeze'' in credit markets stemming from subprime-mortgage losses; and fewer home-equity loans and refinanced mortgages, leading to less consumer spending.

Investors expect the Fed to cut the federal funds rate on overnight loans between banks to 5 percent on Sept. 18 and at least another quarter-point by year's end. The central bank has left the rate at 5.25 percent since June 2006 after raising it from 1 percent over a two-year period.

Gramley, a senior economic adviser at Stanford Group Co. in Washington, said he was surprised by the gloominess of Feldstein's 25-minute speech, which capped a conference where many participants were pessimistic.

go back golfing.. and Ben will call you upto consult with you on how to solve the problem of Americans living beyond thier means and American financial institutions giving people loans that can never be repaid... and having the rest of the world pay for the price for this behaviour.

never mind if there is a recession recession in America you can allways come to thailand who is doing a lot better....

[Martin]

"....come to thailand who is doing a lot better...."

Speaking for the part of Thailand in which I live, 'highdiver', you are exactly right (for now).

My wife is one of the 60% of Thais who are employed in agriculture. "Employed" in her case, as for many other greatgrandmothers, means that she pays (in rice) younger people to do the back-bending part of the rice growing and the sugar cane cultivation, so that she only has to do the management (or brain-work) part of the jobs.

Like the majority of our neighbours, she is happy that she "is doing a lot better" because rain came last month in the nick of time to save the early-planted rice and to enable the later-planting to be done.

While she organises the delivery of the fertiliser, I watch the news from abroad and see two ominous events started last month---food prices world-wide rose alarmingly, and the USA economy showed the first signs of the start of a deep, long recession.

Another thread that is running at this time may not be unconnected with this one. It is the one about Immigration rules being tightened to enable control of foreigner retirements here----presumably aimed at guarding against any Chinese and Indian middle-class influx that might become a threat.

The 'powers that be' in Thailand may operate a bit differently from the 'powers that be' in the countries in which we were brought up, but they do have a track record of keeping everybody in Thailand fed and housed and uncolonised (except in so far as the Chinese immigrants, who were let in in order to provide the commercial services that don't appeal to ethnic Tai people, may have got a bit too much 'coloniser' power).

And the Bangkok 'powers that be' steered Thailand to avoid it being absorbed into either the French or British Empires, and it looks as if the American Empire is now going to wane and cease to be a threat as an economic coloniser.

But we rice growers do need the next 'emperors' to be kept at bay. We can but hope that (between Immigration, FBA, and baht-speculation-witholding rules etc) those 'powers that be' down in Bangkok keep it up.

Yes, the sub-prime meltdown is hitting Thailand with only a little force, and '...Thailand..doing ... better...' is right (for now But the price of freedom is eternal vigilance).

[VegasVic]

WOW, I go on a 4 day golfing road trip and come back to find this sort of garbage! Lao this is really beneath you (at least I hope it is), this is the type of crap that I would expect from Palm or perhaps highdiver.

no there is no problem in sub prime..or credit...... it must be only those silly foold forigners. that got overpriced houses

.and your predicititions......

I would imagine your advice in getting countrywide stocks have nothing to do with your position??

If ignorance of economy is bliss, you must be orgasmic.

Harvard University economist Martin Feldstein said the U.S. housing-market recession threatens to sink the broader economy, and the Federal Reserve can cut interest rates without abandoning its goal of price stability.

``The economy could suffer a very serious downturn,'' Feldstein, president of the group that dates U.S. recessions, told a Fed conference in Jackson Hole, Wyoming. ``A sharp reduction in the interest rate, in addition to a vigorous lender-of-last-resort policy, would attenuate that very bad outcome.''

Already, some indicators are suggesting a weakening economy. First-time applications for jobless benefits rose to the highest level since April in the week ended Aug. 25. Property values in 20 metropolitan areas fell 3.5 percent in June from a year earlier, according to an Aug. 28 report by S&P/Case-Shiller.

Feldstein outlined a ``triple threat'' from housing: a ``sharp decline'' in home prices and construction; higher borrowing costs and a ``freeze'' in credit markets stemming from subprime-mortgage losses; and fewer home-equity loans and refinanced mortgages, leading to less consumer spending.

Investors expect the Fed to cut the federal funds rate on overnight loans between banks to 5 percent on Sept. 18 and at least another quarter-point by year's end. The central bank has left the rate at 5.25 percent since June 2006 after raising it from 1 percent over a two-year period.

Gramley, a senior economic adviser at Stanford Group Co. in Washington, said he was surprised by the gloominess of Feldstein's 25-minute speech, which capped a conference where many participants were pessimistic.

go back golfing.. and Ben will call you upto consult with you on how to solve the problem of Americans living beyond thier means and American financial institutions giving people loans that can never be repaid... and having the rest of the world pay for the price for this behaviour.

never mind if there is a recession recession in America you can allways come to thailand who is doing a lot better....

My my, the end must certainly be near for the great American civilization , because surely the illustrious partisan bleeding heart liberal democrat Mr. Feldstein wouldn't be overstating the situation to curry political favor in the next administration (which no doubt he feels will be a democratic one). As far as Mr. Bernanke is concerned, he knows exactly what he is doing and the solution is very simple, we Americans will continue to sell our debt and Canada, China, Japan, Europe and the rest of the free world will buy it, because the alternative is far too perilous for the other nations to even concieve of Now you can head back to the moo baan and I will get some sleep because I do have a rather early tee time tomorrow

[highdiver]

WOW, I go on a 4 day golfing road trip and come back to find this sort of garbage! Lao this is really beneath you (at least I hope it is), this is the type of crap that I would expect from Palm or perhaps highdiver.

no there is no problem in sub prime..or credit...... it must be only those silly foold forigners. that got overpriced houses

.and your predicititions......

I would imagine your advice in getting countrywide stocks have nothing to do with your position??

If ignorance of economy is bliss, you must be orgasmic.

Harvard University economist Martin Feldstein said the U.S. housing-market recession threatens to sink the broader economy, and the Federal Reserve can cut interest rates without abandoning its goal of price stability.

``The economy could suffer a very serious downturn,'' Feldstein, president of the group that dates U.S. recessions, told a Fed conference in Jackson Hole, Wyoming. ``A sharp reduction in the interest rate, in addition to a vigorous lender-of-last-resort policy, would attenuate that very bad outcome.''

Already, some indicators are suggesting a weakening economy. First-time applications for jobless benefits rose to the highest level since April in the week ended Aug. 25. Property values in 20 metropolitan areas fell 3.5 percent in June from a year earlier, according to an Aug. 28 report by S&P/Case-Shiller.

Feldstein outlined a ``triple threat'' from housing: a ``sharp decline'' in home prices and construction; higher borrowing costs and a ``freeze'' in credit markets stemming from subprime-mortgage losses; and fewer home-equity loans and refinanced mortgages, leading to less consumer spending.

Investors expect the Fed to cut the federal funds rate on overnight loans between banks to 5 percent on Sept. 18 and at least another quarter-point by year's end. The central bank has left the rate at 5.25 percent since June 2006 after raising it from 1 percent over a two-year period.

Gramley, a senior economic adviser at Stanford Group Co. in Washington, said he was surprised by the gloominess of Feldstein's 25-minute speech, which capped a conference where many participants were pessimistic.

go back golfing.. and Ben will call you upto consult with you on how to solve the problem of Americans living beyond thier means and American financial institutions giving people loans that can never be repaid... and having the rest of the world pay for the price for this behaviour.

never mind if there is a recession recession in America you can allways come to thailand who is doing a lot better....

My my, the end must certainly be near for the great American civilization , because surely the illustrious partisan bleeding heart liberal democrat Mr. Feldstein wouldn't be overstating the situation to curry political favor in the next administration (which no doubt he feels will be a democratic one). As far as Mr. Bernanke is concerned, he knows exactly what he is doing and the solution is very simple, we Americans will continue to sell our debt and Canada, China, Japan, Europe and the rest of the free world will buy it, because the alternative is far too perilous for the other nations to even concieve of Now you can head back to the moo baan and I will get some sleep because I do have a rather early tee time tomorrow

oh no the end is not near.

read your post about thes stages of denial....

America is about to go into a long suffering and it will happen as soon as those countries that you refer to as the "suckers" that are buying Amercian debt will stop buying it and decide to invest it in eastern Europe block or in Asia.

American will only understand the magnitude of the crisis when food prices rise...they have already. when the dollar devaluates... it has .

America is still the largest strongest econmy in the world. As such Amercians feel they can go on spending and the rest of the world will pay for it. well it seesm the world is taking a step back.

The total debt of America is numbered in Trillions and this 3 years before the baby boom generation hits the pension funds.

reality will be a very painfull one for many americans in the next year.

[midas]

[quote name='VegasVic' date='2007-09-02 12:03:53' post='1512088'Feldstein outlined a ``triple threat'' from housing:

My my, the end must certainly be near for the great American civilization , because surely the illustrious partisan bleeding heart liberal democrat Mr. Feldstein wouldn't be overstating the situation to curry political favor in the next administration (which no doubt he feels will be a democratic one). As far as Mr. Bernanke is concerned, he knows exactly what he is doing and the solution is very simple, we Americans will continue to sell our debt and Canada, China, Japan, Europe and the rest of the free world will buy it, because the alternative is far too perilous for the other nations to even concieve of Now you can head back to the moo baan and I will get some sleep because I do have a rather early tee time tomorrow

VegasVic if you think Martin Feldstein's opinion is unreliable because it's possibly politically tainted-

then what about the opinions of your fellow countryman Clyde Prestowitz who served as

in the Reagan Administration and has an impressive resume?

He can't be accused of being politically biased because I believe he has now retired from politics ?

He says the power of Asian economies " threatens to end 600 years of Western economic domination

and while China and India focus on trade and industrial policies and turn out competent workers who put in

long hours at a fraction of American wages, the U.S. " struggles with crushing trade and budget deficits, a

zero savings rate, failing schools, dwindling investments in scientific training and research, a collapsing

dollar and a debt-dependent economy that will face an "economic 9/11" once foreign creditors bail out ".

Your opinion of this person's views?

[Naam]

the solution is very simple, we Americans will continue to sell our debt and Canada, China, Japan, Europe and the rest of the free world will buy it, because the alternative is far too perilous for the other nations to even concieve of

that is a fact whether we like it or not personally i don't like it at all but one has to howl with the wolves.

[Carmine6]

VegasVic if you think Martin Feldstein's opinion is unreliable because it's possibly politically tainted-

then what about the opinions of your fellow countryman Clyde Prestowitz who served as

in the Reagan Administration and has an impressive resume?

He can't be accused of being politically biased because I believe he has now retired from politics ?

He says the power of Asian economies " threatens to end 600 years of Western economic domination

and while China and India focus on trade and industrial policies and turn out competent workers who put in

long hours at a fraction of American wages, the U.S. " struggles with crushing trade and budget deficits, a

zero savings rate, failing schools, dwindling investments in scientific training and research, a collapsing

dollar and a debt-dependent economy that will face an "economic 9/11" once foreign creditors bail out ".

Your opinion of this person's views?

Wow, his solution is pretty extreme and most outside the US won't like it. From April 2007.:

".....Both former Federal Reserve Chairman Paul Volcker and Warren Buffett have warned of the high risk of a global crisis that could make the Great Depression look like child's play. If and when the crisis comes, China and the United States and many others would all suffer damage. One can argue about who would suffer the most, but the real issue is how to prevent the crisis.

For starters, currency management by East Asia (not just China) has to stop. The dollar will have to be devalued by 30-50 percent against most of the East Asian currencies. Ideally that could be achieved through negotiation, but if not, Washington might consider seeking action from the WTO to identify chronic currency undervaluation as an illegal export subsidy or as a nullification and impairment of tariff concessions.

snip

By the same token, the subsidies and tax incentives widely used in both Asia and Europe to entice companies to invest in particular countries must be disciplined along the lines that already exist for export subsidies, and Washington could request similar action by the WTO. Cartels and buy-national policies are common in much of the world and U.S. negotiators should also seek to have the WTO classify them as illegal and subject to sanction.

snip

At the same time, Washington should undertake to balance the federal budget, match foreign investment incentives, and reverse American incentives for saving and consumption by such steps as a curtailment of the tax deduction for interest paid on home equity loans and the introduction of a reverse income tax that would progressively tax consumption instead of income."

http://www.econstrat.org/index.php?option=...5&Itemid=46

[Carmine6]

the solution is very simple, we Americans will continue to sell our debt and Canada, China, Japan, Europe and the rest of the free world will buy it, because the alternative is far too perilous for the other nations to even concieve of

that is a fact whether we like it or not personally i don't like it at all but one has to howl with the wolves.

Dr. Naam, if US treasuries disappeared tomorrow, what do you think would replace them? Would people shift to other sovereigns? Or would it spread so much among all issues that just about every company in the would get lower borrowing costs?

Always wondered what would happen.

Edited September 2, 2007 by Carmine6

[Naam]

the solution is very simple, we Americans will continue to sell our debt and Canada, China, Japan, Europe and the rest of the free world will buy it, because the alternative is far too perilous for the other nations to even concieve of

that is a fact whether we like it or not personally i don't like it at all but one has to howl with the wolves.

Dr. Naam, if US treasuries disappeared tomorrow, what do you think would replace them? Would people shift to other sovereigns? Or would it spread so much among all issues that just about every company in the would get lower borrowing costs?

Always wondered what would happen.

your question is rhetorical Carmine. even my wildest phantasies will not produce an answer.

[Martin]

'Carmine 6' quoted:

"".....Both former Federal Reserve Chairman Paul Volcker and Warren Buffett have warned of the high risk of a global crisis that could make the Great Depression look like child's play. If and when the crisis comes, China and the United States and many others would all suffer damage. One can argue about who would suffer the most, but the real issue is how to prevent the crisis.""

The crisis (i.e. recession in the USA and knock-on effects) cannot be prevented.

It has been put off by 'bubble economics'; and maybe it can be done again. But, sooner or later (and it may be now) bubbles come to end because they are not sustainable.

The writing was writ clearly on the wall just over thirty years ago, when it was brought home to my generation that the time (of about four generations) of easy extraction of exosomatics (goodies from within the Earth) was coming to an end. But the message was ignored, and now the next generation of Westerners is going to find it much more messy and painful to adapt to living thriftily and frugally.

Although the crisis cannot be prevented, the great challenge is for it to be managed without a descent into depression (individual/community/national) or into dog-eat-dog violence (individual/community/national).

Unfortunately, the way that Bush and Blair attacked Sadaam Hussein hasn't been a good start, but hopefully wiser councils will start to prevail.

[palm]

You never know, if the US$ appreciates again, maybe the doomsday peasants can upgrade from their 340 baht a night Thai guesthouses to a more financially taxing 400 Baht?

Those pesky Harvard University Economists should lookup VegasVic for lessons on how the world economies (and Thailands) will fare in the future. I bet they could do with a good laugh.

As usual, those with such piss poor personal finances squeal like little girls that the world is falling down. Its very amusing.

Maybe we can hold a raffle or something for these bitter people? I'm sure even Bendix would contribute a cake or something?

[LaoPo]

the solution is very simple, we Americans will continue to sell our debt and Canada, China, Japan, Europe and the rest of the free world will buy it, because the alternative is far too perilous for the other nations to even concieve of

that is a fact whether we like it or not personally i don't like it at all but one has to howl with the wolves.

The 'We Americans will continue to sell our debt' and 'one has to howl with the wolves' will end one day...

"The United States has become the world's biggest debtor nation and the health of its economy is dependent on constant and growing lending from Asia to finance the trade deficit. Both sides are locked in an unsustainable embrace. Americans cannot indefinitely spend more than they earn and Asia will not be willing indefinitely to accumulate American paper."

From (thanks to Carmine6's link):

http://www.econstrat.org/index.php?option=...5&Itemid=46

The future will tell us....maybe it's nearer than we think.

Oh, and before anyone claims I'm a doom sayer...I'm not; I am a realist and pragmatist, nothing more nothing less.

I really would prefer a balanced, calm and growing world economy but the balance in world-finance is out of normal...cold on one side, overheated on the other.

"....Washington should undertake to balance the federal budget, match foreign investment incentives, and reverse American incentives for saving and consumption by such steps as a curtailment of the tax deduction for interest paid on home equity loans and the introduction of a reverse income tax that would progressively tax consumption instead of income.

This won't be easy but if we don't do it now, the markets will do it for us later in what could be the biggest crash of all time."

IMHO the Stars-and-Stripes better stop blaming the rest of the world for their own failure(s) and have a good long look in Grandpa's mirror

Back to the kitchen chaps

LaoPo

[highdiver]

the solution is very simple, we Americans will continue to sell our debt and Canada, China, Japan, Europe and the rest of the free world will buy it, because the alternative is far too perilous for the other nations to even concieve of

that is a fact whether we like it or not personally i don't like it at all but one has to howl with the wolves.

The 'We Americans will continue to sell our debt' and 'one has to howl with the wolves' will end one day...

"The United States has become the world's biggest debtor nation and the health of its economy is dependent on constant and growing lending from Asia to finance the trade deficit. Both sides are locked in an unsustainable embrace. Americans cannot indefinitely spend more than they earn and Asia will not be willing indefinitely to accumulate American paper."

From (thanks to Carmine6's link):

http://www.econstrat.org/index.php?option=...5&Itemid=46

The future will tell us....maybe it's nearer than we think.

Oh, and before anyone claims I'm a doom sayer...I'm not; I am a realist and pragmatist, nothing more nothing less.

I really would prefer a balanced, calm and growing world economy but the balance in world-finance is out of normal...cold on one side, overheated on the other.

"....Washington should undertake to balance the federal budget, match foreign investment incentives, and reverse American incentives for saving and consumption by such steps as a curtailment of the tax deduction for interest paid on home equity loans and the introduction of a reverse income tax that would progressively tax consumption instead of income.

This won't be easy but if we don't do it now, the markets will do it for us later in what could be the biggest crash of all time."

IMHO the Stars-and-Stripes better stop blaming the rest of the world for their own failure(s) and have a good long look in Grandpa's mirror

Back to the kitchen chaps

LaoPo

i totaly agree with your conclusion.

[LaoPo]

THE FED

View from Jackson Hole is hazy and gloomy

JACKSON HOLE, Wyo. (MarketWatch) -- It was only fitting this year that as the central bankers gathered this weekend at the base of the Grand Teton mountain range for their annual summer retreat that clouds moved in, obscuring the spectacular view.

The same has happened with the country's economic outlook.

Federal Reserve [FED] officials and economists, who get together in Jackson Hole, Wyo., to typically discuss the outlook for the next 16 months, suddenly cannot see past the next 16 days.

The credit crunch and resulting financial-market turmoil, which started in the U.S subprime-mortgage market and now has spread around the globe, made conventional forecasting obsolete.

David Hale, an economist and a regular at the Jackson Hole conference, called the current environment "a crisis of information."

There are no accurate data about the true value of complicated securities tied to mortgages and where losses might pop up next, he said. The freeze in the commercial-paper market will also surely lead to losses, especially for small banks, but by how much is unknown, Hale added.

As a result, more bad news from the financial sector may roil the markets in coming days.

Carl Tannenbaum, chief economist at La Salle Bank/ ABN Amro, likened the disclosure of losses in financial firms to storm clouds moving into view.

"I remained concerned that there may still be bad news out there that will cause investors to hunker down once again, and that may make them more reluctant to venture out," Tannenbaum wrote in a recent report to clients. He said that his discussions with experts at Jackson Hole only confirmed this sentiment.

Jan Hatzius, chief economist at Goldman Sachs Group, said at the root of the problem is that many sophisticated investors and hedge funds made billions of dollars of investments with the belief that U.S. home prices would never decline. This widely held view is now being called into question, as economists say there is a strong chance that the median price of U.S. homes could decline this year.

It is difficult for economists to quantify the losses from these investments, according to Hatzius. Economists will have enough trouble gauging the likely default rate on mortgages in coming months as the economy slows down, he said.

Most of the economists at Jackson Hole believe that a rate cut by the Fed is a foregone conclusion.

Economic impact

The hard data on the impact of the credit crunch and market turmoil on the U.S. economy is also a few months away. The third quarter was almost half over when the crisis erupted.

Economists at BNP Paribas wrote in a research note that it "will be months" before the impact shows up in unemployment data.

The tightening of financial markets is likely to have a negative impact on GDP, especially in the fourth quarter. Fourth-quarter GDP data won't be released until January 2008.

Rest of article here:

http://www.marketwatch.com/news/story/us-s...ist=morenews_ts

LaoPo

Edited September 3, 2007 by LaoPo